Archive
Reuters blog archive
from Breakingviews:
Olympus fiasco strengthens the case for Japan reform
By Wayne Arnold
The author is a Reuters Breakingviews columnist. The opinions expressed are his own.
Olympus' embarrassing decision to dump its foreign chief executive two weeks after naming him to the job shows that reform is a slow and fitful process. Michael Woodford was brought in to carry out a house-cleaning at the Japanese camera maker, and became one of the country's handful of non-Japanese corporate bosses. That the board decided to fire him so soon shows the medicine was distasteful. It also strengthens the case for a bigger dose.
Unlike foreign bosses who came from outside, like Nissan's Carlos Ghosn and Sony's Howard Stringer, Woodford spent 30 years working his way up through the ranks. Worryingly, he has alleged in the Wall Street Journal that his dismissal came in response to questions about governance problems raised by a local magazine. One issue seems to be high prices paid for overseas takeover targets. That wouldn't be unusual: big-name Japanese firms all too often splash out for bolt-ons abroad to raise revenue without having to undertake more painful restructuring at home.
Olympus needs restructuring in spades. It has a roughly 75 percent market share in endoscopes, where operating profit margins are as high as 30 percent, by Goldman Sachs estimates. Yet it has clung to a loss-making business of selling digital cameras, competing with the likes of Nikon and Samsung. Group revenue increased by 80 percent between 2001 and 2008, but earnings fell 37 percent, while net debt to equity increased sharply.
from MacroScope:
Drop in Fed custody holdings reflects FX interventions
A sharp recent drop in the Fed's holdings of U.S. Treasuries for foreign central banks probably reflects the effort by many developing economies to stem rapid declines in their currencies, not some frightening move by the likes of China out of U.S. bonds. That's the argument put forth by Marc Chandler at Brown Brothers Harriman, who notes the pullback of recent weeks appears to have been the most dramatic since the Asian financial crisis of the late 1990s.
His reasoning makes sense: a September spike in the U.S. dollar was accompanied by steep plunges in the exchange rates of many emerging economies. Still, Chandler remains puzzled as to why the selling accelerated to a hefty $21 billion even as the dollar reversed course in the last week:
from The Great Debate UK:
The QE billions should go direct to consumers
By Mark Hillary. The opinions expressed are his own.
In 1998, the Japanese government was ridiculed for giving away almost $6bn (at 1998 value) of shopping vouchers. The plan was that consumers would spend more of this ‘free money’ and help lift Japan out of the seemingly endless malaise it suffered in the nineties – as many other developed economies were enjoying a roaring decade.
One of the major faults in the Japanese plan was that the vouchers could easily replace the need to spend actual money. If my groceries cost me $100 then why would I still spend $100 of cash on groceries and buy a nice meal in a restaurant with my voucher, when I could just use the voucher for those groceries?
from Photographers Blog:
Learning to smile again
By Toru Hanai
Six months after Japan's massive earthquake and tsunami, I went back to visit six-year-old Wakana Kumagai who lost her father in the disasters in Higashi-Matsushima, Miyagi prefecture.
I photographed Wakana when she visited her father's temporary grave at a mass burial site in Higashi-Matsushima on April 21, after attending an entrance ceremony at her elementary school. I was struck by how positive and optimistic Wakana behaved.
from Photographers Blog:
Half a year after disaster
By Kim Kyung-hoon
“Time flies so fast.”
I can’t count how many times I've mumbled this phrase while traveling in Sendai and Fukushima last week for the six month anniversary of the March 11th earthquake and disaster that left tens of thousands dead across Japan and caused the worst nuclear disaster in 25 years.
With the scenes of fear and hopelessness from the areas devastated in March and the hardship of the assignments still vivid in my memory, I feel like the disaster happened just a few weeks ago.
from The Great Debate UK:
What message is the CDS market sending us?
By Laurence Copeland. The opinions expressed are his own.
Not many people seem to have noticed, but something almost unthinkable has happened in the Credit Default Swap (CDS) market recently. It is now one point cheaper to insure against a default by Her Majesty’s Government than by the Federal Republic of Germany. Given that only a few months ago, Markit was quoting twice as much to insure against a default on gilts as on bunds, this is a major change – but what is it telling us?
The message is unclear, but my guess is it is not quite the one which Britain’s Chancellor, quite reasonably from his point of view, would have us believe. Yes, the market has faith in our ability and willingness to repay – but that is far from the whole story.
from Photographers Blog:
Invisible snow
Invisible Snow from Reuters Tokyo Pictures on Vimeo.
When the Fukushima nuclear power plant exploded, I was in Fukushima covering people who had evacuated from their houses near the plant, as they underwent radiation checks as authorities isolated those who had showed signs of exposure.
The disaster control center in the prefectural government hall in Fukushima city, situated about 63 km (39 miles) north-west of Fukushima Daiichi nuclear plant, was chaotic. However, once I stepped out the building, everything around me looked the same in the city and it was difficult to comprehend what was actually happening. People in the city were walking their dogs outside and riding their bicycles on the streets, although lights were out and many places were experiencing cuts in water supplies.
from Photographers Blog:
Clearing the rubble but not the sorrow
800.jpg)
By Kim Kyung-hoon
In 2004 I was in Indonesia’s Banda Aceh covering the Indian Ocean tsunami disaster which killed over 230,000 people in several south Asian countries. I met a tired-looking man tackling huge piles of rubble created by the tsunami in a brave effort to clean it up. He had only a shovel to use on the debris stretching on all sides as far as the eye could see. He stopped a moment and bemoaned to me that it would take more than several years to clear the rubble in his country. He also added that a rich country like Japan could clear it quickly with giant heavy construction equipment if a similar disaster happened in Japan. When I left Banda Aceh after my one-month stay there, the scenery going from the Reuters temporary base to the airport was almost the same as what I had seen on my first day there, and dead bodies still lay on the streets.
Last weekend, I traveled to Japan’s tsunami–destroyed towns again with my colleague to cover Japan’s traditional festival obon, when families welcome back the spirits of the dead.
from Photographers Blog:
Fishing with film
By Carlos Barria
In the "old" days, back before digital photography, photographers used to lug around tons of extra luggage, portable dark rooms, and set up shop in their hotel bathrooms. Or they would send their film -- by motorcycle, car or even plane -- to somebody else in a hotel or office close by to develop it, scan it and file. Or they might have to scramble and look for a lab in the middle of a crisis, in a foreign country. I don't think my colleague Joe Skipper speaks Spanish, but I know that when he covered a showdown at Colombia's Justice Ministry in the 80s, he learned how to say, "Mas amarillo!," "More yellow!
North America chief photographer Gary Hershorn arrives to the Vancouver international airport with all his photo lab luggage. REUTERS/Stringer
from Photographers Blog:
Robot Paro comforts the elderly in Fukushima
By Kim Kyung-hoon
When I covered Fukushima’s nuclear crisis in March, the first radiation evacuees who I encountered were elderly people who had fled a nursing home which was located near the tsunami-crippled nuclear power plant which was leaking nuclear radiation.
On that night, most of the elderly who could not move well due to old age spent a cold night on a temporary shelter’s hard floor.
